Indefinite Delivery, Indefinite Quantity or IDIQ are terms that are often used when doing business with the federal government through the General Services Administration (GSA) Multiple Award Schedule (MAS) Program. IDIQ may might just sound like any other random government contracting acronym to you, but it is an important term to remember.
So, what are IDIQs? Indefinite Delivery, Indefinite Quantity (IDIQ) contracts were created to help streamline the procurement process and speed-up delivery. All GSA Schedule contracts are considered IDIQ contracts, so if you are a current or prospective GSA MAS contract holder, you should understand how they work. Here’s what you need to know.
What Are IDIQ Contracts?
IDIQs are Indefinite Delivery, Indefinite Quantity contract vehicles that provide an indefinite quantity of products or services for a fixed time. They are used when GSA or federal agencies can’t determine above a specified minimum, the exact quantities of supplies or services that the government will need during the contract period.
To establish an IDIQ, Contracting Officers (COs) need to determine a minimum quantity, a reasonable maximum quantity, a fixed time period, and a Statement of Work (SOW). Although they are considered “indefinite”, reasonable thresholds such as “maximum order limits” are still established for contractors.
In the federal contracting world, there are many different contract vehicles that use IDIQ contracts. Some of the most popular IDIQ contracting vehicles are:
Types of IDIQ Contracts
Single-Award IDIQs
The first type of IDIQ contract is the single-award IDIQ. A single-award IDIQ can be established and awarded to a single contractor. The base contract has no funding associated with it, and it lays out the terms and conditions and pricing applicable to any orders placed against the base contract. It’s important to note that GSA Schedule contracts are not single-award IDIQs.
There are some pros to single-award IDIQs such as:
- The ability to establish set prices for products and services with single vendors significantly reduces procurement lead time at the ordering level.
- A single vendor solution reduces the burden on government to perform integration function.
- The ability to offer agency wide ordering through an established IDIQ increases flexibility to meet various or mission needs quickly.
- The ability to establish streamlined ordering procedures for future requirements reduces lead time to award.
Multiple-Award IDIQs
The second type of IDIQ is the multiple-award IDIQ. These are the most common type of IDIQ contracts and the type of contract vehicle that GSA Schedule contractors utilize.
A multiple-award IDIQ may be established and awarded to multiple vendors. When orders are placed against a multiple-award contract, all awardees holding a base contract are requested to submit a proposal to provide each contractor a fair opportunity to be considered for each order.
There are some pros to multiple-award IDIQs such as:
- The ability to establish unique contract terms and conditions increases flexibility for all types of acquisition programs.
- Continuous competition reduces risk for vendor lock and keeps pressure on pricing.
- Fair opportunity enables selection of best of breed solutions.
- The ability to offer agency wide ordering through an established IDIQ increases the flexibility to meet various mission needs quickly.
- The ability to establish streamlined ordering procedures for future requirements provides opportunities to reduce procurement lead time.
However, there are some disadvantages to multiple-award IDIQs such as:
- The fair opportunity requirement increases lead time to award with evaluations at the ordering level.
- Fair opportunity orders above Federal Acquisition Regulation (FAR) threshold can be challenged with bid protests.
- Multiple-award IDIQs can increase administrative cost and contract management complexity.
- The processes to establish IDIQ traditionally have a long procurement lead time to award.
Benefits of Having an IDIQ Contract
IDIQs are commonly used by federal government agencies because they streamline the procurement process. Agencies will sometimes have frequent needs for specific products or services, but are unsure of the duration or the quantity needed of the line item.
IDIQs expedite the process since the contract isn’t needed to place every single task or delivery order. IDIQs will also save agencies money because they eliminate the need for multiple bidding processes. This makes them valuable for both government agencies and government contractors.
Acquiring a GSA Schedule will allow you to take advantage of the benefits of IDIQs in the federal marketplace. Not only are IDIQs often preferred by government customers, but the GSA MAS Program is the largest and most active of the IDIQ contracts.
Are You Interested in Getting a GSA Schedule?
If you are looking to acquire a GSA Schedule, we have some resources to help you get started. First, you’ll want to check out the requirements to get on a GSA Schedule and the GSA Schedule acquisition process. Next, you’ll want to read up on how to become a GSA Schedule contractor.
If you have any questions about the process or if you need help getting a GSA Schedule, one of our consultants is here to assist you. You can also check out our blog or our monthly newsletters for more government contracting insights.
